P16.7-B Del Monte IPO in the works

The Campos family is planning a P16.7-billion initial public offering (IPO) for food and beverage arm Del Monte Philippines Inc. (DMPI), a leading fruit, canned fruit, fruit juice and spaghetti sauce supplier in the country and operator of one of the world’s largest fully integrated pineapple production hubs.

The plan is to sell 559.464 million secondary shares for as much as P29.88 each, bringing about 20 percent of DMPI’s shares to public hands, parent Del Monte Pacific Ltd. (DMPL) said in a disclosure to the Philippine Stock Exchange on Tuesday.

DMPI is an indirect wholly-owned subsidiary of DMPL, which is listed on both the PSE and Singapore Stock Exchange Securities Trading Ltd. (SGX-ST).

The Philippine unit is the wholly owned subsidiary of Central American Resources Inc. It is a wholly owned subsidiary of Del Monte Pacific Resources Ltd. which is, in turn, a wholly owned subsidiary of DMPL.

The DMPL group aims to raise funds from the IPO to partially prepay or repay loan facilities, the disclosure said.

In 2014, DMPL made the bold move of acquiring the US consumer food business of Del Monte Foods Inc. (DMFI) for $1.675 billion, thereby breaking into the US market and reuniting with its US mother brand. This transformed DMPL into a multinational corporation with sales breaching $2 billion. But because it bought a company much bigger than itself, DMPL entered a consolidation phase after this takeover.

The company is now reducing the debt stock incurred following the acquisition of DMFI.